Weekly comments from Dale Martin: the FY2018-19 Budget

July 27, 2018 12:00 p.m.

For his Weekly Report this week, Fernandina Beach City Manager Dale Martin has provided his FY 2018-19 Annual Budget Message which is reproduced below.

Honorable City Commissioners, Residents, and Staff of the City of Fernandina Beach:

Please find following this memorandum the proposed 2018 budget.

Planning for the 2018 budget began with the City Commission’s annual goal-setting, conducted over the course of several meetings, earlier this year.

The proposed budget reflects total revenues and expenditures in the amount of $154,610,817. Approximately one-third of that amount, however, is related to cash, revenues, and expenditures associated with the Trust and Agency Funds. With those funds excluded, proposed revenues and expenditures total $99,337,817.

The portion of the proposed budget that typically draws the most interest is the General Fund, which is the primary operating fund for the City, and principally financed by property tax receipts. The proposed General Fund expenditures total $21,892,918. The proposed General Fund budget is supported primarily by an operating millage rate of 5.8553 mills, a lower operating millage rate than levied by the City for the previous budget (6.0000). Despite the reduction of the property tax rate, the proposed millage rate, as defined by state statutes is considered a tax increase.

The total proposed millage rate consists of the 5.8553 mills levied for operations, and 0.1929 (down from last year’s 0.2097) mills levied for voter-approved debt service. The proposed property tax levy, at a collection rate of 96%, will generate approximately $12,753,306. The City’s aggregate taxable value increased by approximately 8.8%. The comparable taxable value (an effort to compare “apples to apples” from the preceding year) increased by 6.7%. Despite these substantial increases, the increase in taxable value of many properties (if classified as a “homestead” property) is limited to no more than three percent or the rate of inflation, whichever is less (in this case, the 2018 rate of inflation is 1.0147%). If a property not subject to those limitations experienced an increase in taxable value of 6.7%, the estimated increase in related property taxes would be about $31 for every $100,000 of 2018 taxable value.

For the second consecutive year, the City’s continued growth and related utility usage will enable the City to forego a rate increase of water and wastewater fees. No utility rate increase is budgeted for the next fiscal year. The additional anticipated revenues resulting from the growth and usage will satisfy the financial needs of the utility systems.

Staff additions included in the proposed budget are minimal: two full-time Police officers (actually already hired to support school security as recently mandated by State statute) and two part-time Police Service Aides; two additional Streets Maintenance personnel; new full-time office support personnel for the Planning and Conservation Department and the Stormwater Department. The accounting for some positions, previously funded through two or more departments, has been clarified, especially in the Building, Planning, and Code Enforcement Departments.

Proposed capital projects funded by the General Fund are somewhat constrained this year due to the need for financial support for the Marina as it recovers from Hurricane Matthew: $775,000 (in addition to $325,000 of grant funding) will be used to fund dredging operations. Other capital projects shed light on some of the City’s aging infrastructure: a new auditorium roof at the Atlantic Recreation Center; new windows and doors and the Peck Center; new playground equipment at the Martin Luther King, Jr. Recreation Center; and a new front-end loader. Finally, the Capital Improvement Fund also includes approximately $1,600,000 to complete the beach renourishment project that started earlier in this year’s budget. Total Capital Improvement Fund projects, funded by the City’s General Fund, County and State allocations, and loan proceeds, are budgeted at $5,486,215.

In accordance with the City’s reserve policy, approximately $4,398,915, or 20.1% of General Fund expenditures, is budgeted for reserves. When the otherwise restricted reserves of the Building Department are included, the total reserve sits at 30.4%.

The Marina, pending final permitting (U.S. Army Corps of Engineers) and funding (bank loan and Federal Emergency Management Agency), will begin and complete its recovery from Hurricane Matthew. The other Enterprise Funds continue their efforts to support operations. The Golf Course will procure additional (overdue) maintenance equipment. The Airport, after dedicating the new terminal building, will continue its capital improvements with hangar repairs, preliminary efforts related to runway rehabilitation, and airport markings (these projects are significantly funded through Federal Aviation Administration and Florida Department of Transportation grants). The Wastewater Fund and Water Fund will continue their efforts to maintain and improve the City’s excellent utility infrastructure through a variety of projects (budgeted at nearly $2,000,000). Moving into its second full year of operation, the Stormwater Fund will continue its efforts to protect key assets and infrastructure.

This proposed budget marks the final involvement of Comptroller Patti Clifford: Ms. Clifford plans to retire at the end of the calendar year, completing fourteen years of service with the City. Her professionalism and experience have played a significant role in the strong current financial position of the City. Thank you, Patti, for the guidance and support that you have provided during my tenure in Fernandina Beach.

I also wish to express my appreciation to the Department Directors for their assistance. The policies and priorities as indicated by the City Commission resulted in some difficult decisions in what was to be funded. Since other funding opportunities may be available, I look forward to working with the City Commission to complete the 2019 budget.

I have served this community for nearly three years: a community with high expectations for quality of life and levels of service. I sincerely hope that I have been able to lead the dedicated and professional City staff in pursuit and attainment of those standards. I look forward to continuing to raise those standards and make this an even better place to live. I am thankful for the support provided to me by the City Commission, the City Staff, and, most importantly, the residents of Fernandina Beach that I am privileged to serve.

Sincerely,

Editor’s note:  To see the proposed budget in its entirety, click here.